What Home Insurance Usually Helps Protect
Homeowners insurance may help pay for damage to your home and belongings caused by covered events, such as fire, wind, or theft. It may also provide personal liability coverage if you are legally responsible for another person’s injury or property damage. Most mortgage lenders require homeowners’ insurance to help protect the property securing the loan.
For example, if wind or another covered cause of loss damages your roof, your homeowner’s insurance may help with repair costs after the applicable deductible. Coverage and payment depend on the policy terms, exclusions, limits, and loss-settlement provisions.
What Home Warranty Coverage Usually Helps With
A home warranty is a service contract, not a homeowners insurance policy. Depending on the contract, it may help pay to repair or replace certain covered home systems and appliances when they break down.
Home warranties often include service fees, coverage limits, and exclusions. That means not every repair will qualify.
Cost, Claims, and Coverage Limits
Homeowners insurance typically involves a premium and an applicable deductible when a covered property claim is filed. A home warranty generally involves a monthly or annual contract cost and may require a service fee when covered service is requested.
The biggest difference is the type of problem each is designed to address. Homeowners insurance may help after a covered cause of loss, while a home warranty may help when a covered system or appliance breaks down under the terms of the service contract.
Do You Need One or Both?
Some homeowners choose both because each option serves a different purpose. A warranty may help with repair concerns, while homeowners insurance may help protect against larger covered losses.
Before an unexpected cost happens, review your current protection and know what is covered. A Farmers Union Insurance agent can help you review your homeowners insurance and understand the coverage, limits, deductibles, and exclusions included in your policyTo get started, contact us or call 1 800 366 8331.
Homeowners insurance coverage is subject to applicable policy terms, conditions, limits, deductibles, and exclusions. Home warranty coverage is subject to the terms and limitations of the applicable service contract.
Image Credit: Jirapong Manustrong // Shutterstock
